CICC: Maintains Alibaba-W (09988.HK) "Outperform" rating, target price HK$172; expects second fiscal quarter non-GAAP net profit attributable to shareholders to beat expectations.

CICC released a research report stating that it maintains an "Outperform" rating on Alibaba-W (09988.HK), with target prices of HK$172 and US$178 for the Hong Kong and US stocks respectively, implying 65% and 66% upside from the current stock prices. The bank expects Alibaba's revenue for the second quarter of fiscal year 2027 (the third quarter of 2026) to grow 9.8% year-on-year to RMB272.1 billion, with adjusted EBITA of RMB30.3 billion and non-GAAP net profit attributable to shareholders of RMB27.2 billion, higher than market consensus, mainly due to reduced losses in AI Labs and application businesses and better-than-expected e-commerce performance. The bank raised its non-GAAP net profit attributable to shareholders forecasts for fiscal years 2027 and 2028 by 9% and 2% to RMB110.1 billion and RMB161.3 billion, respectively, and is bullish on the growth potential of cloud computing and AI businesses.